Gold Stabilizes After 6% September Slide

Gold prices remained relatively unchanged on Thursday after falling 6% in September. The precious metal was affected by softer U.S. inflation data, which reduced expectations for another Federal Reserve rate hike.

The Fed's preferred measure of underlying inflation, the personal consumption expenditures price index excluding food and energy, rose 0.2% in August, below expectations. This revision gave markets some relief over the inflation outlook, causing traders to sharply reduce expectations for an interest rate increase at the Fed's October meeting.

However, elevated long-term Treasury yields continued to leave gold vulnerable to renewed selling. The U.S. consumer spending rose in August at its fastest pace in more than a year, which helped keep longer-dated Treasury yields near multi-decade highs.